Kentucky's Lt. Governor Henry Sued

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Federal authorities filed a lawsuit Thursday accusing Lt. Gov. Steve Henry, an orthopedic surgeon who plans to run for governor next year, of defrauding Medicare and Medicaid.

The allegations stem from Henry's role supervising orthopedic residents, or surgeons in training, at the University of Louisville.

Under federal regulations, supervising physicians must be physically present during surgery to legally bill the two government programs for their time. Thursday's lawsuit, brought under the False Claims Act, alleges Henry improperly billed for 44 surgeries it says he missed.

All 44 surgeries were between 1996 and 2001 — years following Henry's 1995 election as lieutenant governor.

Each incident described in the lawsuit outlines Henry's whereabouts at the time. Most show the Democrat attending political functions when the surgery was performed, including an Oct. 10, 1996, surgery the lawsuit shows listed for the same hours it says Henry was awaiting the arrival of President Clinton at a political rally.

Henry called a news conference for Thursday afternoon to respond to the lawsuit.

He has said he intended to continue exploring a run for governor despite any legal action by federal authorities.

Gov. Paul Patton, embroiled in his own scandal over allegations that he used his office to assist and then retaliate against a business owner with whom he had affair, is barred by term limits from seeking re-election.

The case against Henry had been investigated for possible criminal violations, but U.S. Attorney Stephen Pence said in September that he would not seek an indictment.

He said that he delayed filing the lawsuit at the request of Henry's lawyers but that settlement discussions had ``not been fruitful.''

Under the False Claims Act, the government is allowed to triple the amount of damages to the state. Pence estimates the loss to the state at $60,000 — tripled to $180,000. The lawsuit also seeks a penalty between $5,000 and $11,000 for each claim, boosting the total to between $400,000 and $600,000, Pence said.

Most investigations under the act have involved Medicare, which pays for health care for the elderly and also provides billions of dollars to the nation's teaching hospitals for medical education.